Latest Federal Reserve Report Acknowledges Health Care Law Slows Hiring and Consumer Spending, Increases Costs
ECONOMY ALERT: Warnings of Job Loss Coming True
WASHINGTON, DC – The Federal Reserve yesterday released a report confirming that uncertainty and increased costs caused by the health care law are leading employers to lay off workers and slowing new job creation. The “Beige Book” – which summarizes economic conditions from twelve regions across the country, including Boston, New York, Chicago, Dallas and San Francisco — provides insight into employers’ thoughts on how the health care law’s increased regulations are forcing premiums and health care costs to rise, increasing burdens on job creators, and consequently, creating uncertainty that hurts job creation.
Increased Premiums and Health Care Costs
Employers in four regions indicated, “rising health insurance premiums remain a challenge” and “concern,” and further anticipated health care cost increases “have contributed to a modest decline in consumer confidence.” Participants from Chicago explained that these higher costs will be passed along to employees.
Atlanta participants reported, “On balance, firms providing accounting and consulting services to health care providers reported much-increased demand because of regulatory changes, resulting in a shortage of compliance specialists.”
Uncertainty Hurts Hiring
Kansas City participants noted, “Firms continued to report changes in health care policy and fiscal uncertainty as reasons for delayed hiring,” as well as “planned layoffs and reluctance to hire more staff.” Some employers were concerned that companies are “hiring the absolute minimum to get by due to uncertainty about the Affordable Care Act.” Atlanta participants explained, “costs relating to tax policy, regulation, and health care remained sources of uncertainty going into 2013.”